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Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of
Policy and Rules Concerning the
Interstate, Interexchange Marketplace
Implementation of Section 254(g) of the
Communications Act of 1934, as amended
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CC Docket No. 96-61
ORDER
Adopted: November 16, 2000 Released: November 17, 2000
By the Chief, Common Carrier Bureau:
I. INTRODUCTION
1. In 1996, the Commission adopted mandatory detariffing for the interstate, domestic,
interexchange service of nondominant interexchange carriers (IXCs). After two Commission
orders on reconsideration and judicial review in the D.C. Circuit, the Commission's detariffing
rules took effect on May 1, 2000. In this Order, the Common Carrier Bureau, pursuant to a
specific delegation of authority, resolves a number of issues relevant to the transition to a
detariffed regime. Specifically, we:
(1) Extend the deadline for detariffing mass-market consumer services from
January 31, 2001 to April 30, 2001;
(2) Affirm that the deadline for detariffing contract-type services is January 31,
2001;
(3) Decline to permit IXCs to continue filing new or revised contract tariffs that
bundle domestic and international service until such time as the Commission
may have detariffed their international offerings;
(4) Permit the practice of filing a bundled domestic and international tariff with a
disclaimer stating that the domestic portion of the document is for information
purposes only;
(5) Require IXCs to be in full compliance with the public disclosure and Internet
web-posting requirements at the time any service is detariffed, with respect to
that service. With respect to new and revised contract services that have
become effective since May 1, 2000, IXCs must be in full compliance with
the public disclosure and web-posting requirements within 30 days of the
release of this Order;
(6) Require Internet web sites and public disclosure sites to be updated no later
than 24 hours after the effective date of a change in the rates, terms, or
conditions of a detariffed service;
(7) Clarify that the disclosure and web-posting requirements apply to contract
services as well as to mass-market offerings;
(8) Specify the filing deadlines for the required annual certification of compliance
with geographic rate averaging and rate integration requirements; and
(9) Clarify the application of tariff filing requirements during the transition
period.
X. DETARIFFING AND TRANSITION ISSUES
A. Transition Period
11. The Commission ordered all nondominant IXCs to cancel or permit the expiration of
all tariffs for domestic, interstate, interexchange services within nine months of the effective date
of the Second Report and Order and not to file any such tariffs thereafter. The Commission also
required carriers to establish public disclosure locations and web sites to distribute information
on the rates, terms, and conditions of the carrier's interstate, domestic, interexchange services
during the transition period. In response to the D.C. Circuit's stay of the Commission's
detariffing rules pending judicial review, the Commission delegated authority to the Bureau to
determine the appropriate transition period and to address other transition issues when the
detariffing rules became effective. The court subsequently upheld the detariffing rules and
lifted its stay on May 1, 2000, at which time the rules became effective. Pursuant to its
delegated authority, the Bureau then adopted a nine-month transition period with a deadline of
January 31, 2001 for detariffing of IXC interstate, domestic, interexchange services. The
Bureau also sought comment on potential modifications to the transition plan.
12. In response to the Bureau's action, several parties recommend that the transition
period be extended to allow the Commission an opportunity to complete a detariffing proceeding
for international interexchange services, and that the transition periods for both the domestic and
international interexchange services should coincide. On October 18, 2000, the Commission
released a Notice of Proposed Rulemaking seeking comment on whether to detariff the
international interexchange services of nondominant IXCs. The pleading cycle in that
proceeding closes December 4, 2000.
13. The Commission has engaged in a lengthy effort to accomplish detariffing of long-
distance service in large part because it concluded that tariffing both prevents the operation of
competitive markets and ultimately is harmful to the interests of consumers of such services. In
particular, the Commission concluded that detariffing will enhance competition among providers
of interstate, domestic, interexchange services; promote competitive market conditions; eliminate
possible invocation of the filed rate doctrine by nondominant IXCs; and establish market
conditions that more closely resemble an unregulated environment. Commenters assert,
however, that the long-term benefits of detariffing may be overshadowed, in the short term, by
the inconvenience and possible confusion of going through the detariffing process twice in the
event the Commission decides to detariff international interexchange services. We find that,
with respect to users of mass-market consumer services, we should extend briefly the deadline
for detariffing such services in order to allow the Commission time to fully consider whether
such an approach is appropriate. Accordingly, in order to allow the Commission to consider
whether to establish a coordinated timetable for detariffing domestic and international consumer
services, we extend the deadline for full detariffing of IXC interstate, domestic, interexchange
services to April 30, 2001. For the contract-type services of domestic interexchange carriers, we
retain the nine-month transition period that we announced in the May 9 Notice. We conclude
that the likelihood of confusion with respect to business customers using such services is much
less of a concern, and thus is clearly outweighed by the benefits of detariffing as soon as possible.
A. Bundled Domestic and International Services
1. Permissive Tariffing of Domestic Services
14. In the Second Report and Order, the Commission recognized that a number of IXCs
file bundled or "mixed" services tariffs, which include both interstate, domestic, interexchange
services and international services. Because the order did not require detariffing of international
services, it allows carriers to cancel portions of "mixed" services tariffs that are subject to
detariffing by either: (1) cancelling the entire tariff and refiling a new tariff for only those
services that remain subject to tariff filing requirements; or (2) issuing revised tariff pages
cancelling the material in the tariffs that relate to services subject to forbearance. In order to
minimize the costs of partitioning bundled offerings, the Commission also modified its rules to
permit nondominant IXCs to cross reference detariffed interstate, domestic, interexchange
service offerings in their tariffs for international services for purposes of calculating discounts
and minimum revenue requirements. The Commission also determined in the Second Report
and Order that it would not accept new contract tariffs or revisions to current contract tariffs for
long-term service arrangements during the transition period but would accept new and revised
tariffs for mass market services.
15. A number of parties filed comments stating that the cancellation of the domestic
portion of bundled contract tariffs will cause confusion for customers and administrative
problems for the carriers. These parties recommend permissive tariffing of the domestic
portion of the bundled contract tariffs to alleviate potential customer confusion during the
transition period and while the Commission decides the issue of international detariffing, because
customers expect to find service information in one document or location. Business
Consumers, however, objects to these proposed modifications of the Commission's mandatory
detariffing decision.
16. We will not depart from the policy the Commission enunciated in the Second Report
and Order that permissive tariffing of the domestic portion of bundled contract tariffs is not in
the public interest because permissive tariffing would not eliminate the possible invocation of the
"filed-rate" doctrine. Also, permissive tariffing would merely cause added delay to the process
of implementing detariffing for all domestic services. Because we find that the requested actions
are inconsistent with the Commission's goals outlined in the Second Report and Order, we
decline to adopt these suggestions.
2. Disclaimers
17. In their comments, some IXCs suggest that the problems associated with a dual
regime for domestic and international services would be minimized if carriers were allowed to
file the domestic portion of a contract tariff for bundled domestic and international services with
a disclaimer or banner that states that the domestic portion is included only for informational
purposes. Several IXCs have been filing new and revised contract tariffs for bundled services
with such banners. Several parties cite to the potential for customer confusion during both the
transition period and during the period in which Commission considers detariffing of
international services as a basis for allowing banners to be included in the bundled contract
tariffs.
18. The Commission has already revised its rules to allow carriers to cross-reference
detariffed interstate, domestic interexchange service offerings in their tariffs for international
services for the purpose of calculating discounts. Cross-referencing is technically sufficient to
ensure that detariffing of domestic offerings does not deprive customers of the opportunity to
negotiate discounts based on their total volume of calls. It is appropriate, however, to consider
whether additional relief is necessary to reduce customer confusion that could arise during the
period that international services are subject to tariff filing requirements and domestic services
are subject to detariffing.
19. We will permit IXCs to file, as international service tariffs, tariff documents that
describe bundled domestic and international contract service. Such filings must bear a banner or
disclaimer in a conspicuous place, and will be permitted only during the transition period and
until the Commission makes a final determination regarding detariffing of international services.
This will help minimize customer confusion and reduce the administrative burden associated
with separating the two services in existing contracts and contracts currently under negotiation.
Bundled domestic and international contract tariffs filed that include a disclaimer or banner in a
conspicuous place are consistent with the Commission's detariffing goals, and the domestic
portions of such mixed service contract offerings will not be considered to be official tariffs filed
pursuant to Section 203.
20. We direct carriers that choose to use the banner approach to include: (1) a statement
that the domestic services portion of the tariff has been filed for informational purposes only and
is not on file pursuant to the tariff filing requirements of 47 U.S.C. 203; (2) in the case of a
revised tariff, a statement that the domestic services portion of the tariff was effectively cancelled
as of the date the banner language was added to the tariff; and (3) a statement that the domestic
services portions of contracts relating to bundled domestic and international contract services
supersede the domestic information included in the bundled domestic and international contract
tariffs on file with the Commission. The inclusion of the banner language does not affect
carriers' ability to negotiate new contracts covering the domestic portions of their existing
contracts. Customers are free to negotiate for domestic services that are not filed in bundled
domestic and international tariffs. If a carrier has already separated the domestic portion from the
international portion in a mixed service contract arrangement, the banner is not required on the
international tariff filed with the Commission.
A. Public Disclosure and Internet Information Requirements
1. Timing of Compliance and Updates
21. The Commission determined in the Second Report and Order, and affirmed in the
Second Order on Reconsideration, that it is in the public interest for nondominant IXCs to make
available to the public information on current rates, terms, and conditions for all of their
interstate, domestic, interexchange services in an easy to understand format, in a timely manner,
and in at least one location during regular business hours. In addition, the Commission required
IXCs that have established Internet websites to post that same information on-line in a timely and
easily accessible manner, and to update the information regularly. The Commission determined
that IXCs should also maintain price and service information regarding all of the interstate,
domestic, interexchange service offerings to present to the Commission upon request.
22. The parties' comments include various recommended deadlines for compliance with
the public disclosure and Internet web-posting requirement. Various parties recommend that
carriers should comply with the requirement (1) immediately, regardless of whether services have
been detariffed; (2) when a service offering is detariffed and no later than the expiration of the
nine-month transition period; (3) at the end of the nine-month transition period; (4) 30 days
after the expiration of the transition period; and (5) within 30 days of the Commission's final
decision. One party recommends that revised information and updates should be posted within
24 hours of the effective date of the new or revised rates and terms, but no later than the next
business day.
23. With respect to services that are permitted to remain under tariff during the transition
period, we conclude that carriers should be allowed the full transition period in order to comply
with the Internet and public disclosure requirements of the Second Report and Order and the
Second Order on Reconsideration. We find that it is in the public interest to allow the carriers
adequate time to establish public information locations and to modify their websites so as to
provide accessible, comprehensive and comprehensible information about their service offerings
to the public.
24. We also agree, however, with parties that argue that carriers should post information
at public information sites and on Internet websites as soon as practicable after cancelling the
tariff for a service. This timing is important so customers will have continuous access to
information during the transition to a detariffed environment. We find, therefore, that carriers
should not cancel tariffs pursuant to the Second Report and Order and the Commission's rules
until they are able to post rate, term, and other service information regarding the services
included in the cancelled tariffs at a public information location and, for those that maintain web
sites, on the Internet. Consistent with section 61.87(b) of the Commission's rules, when a
carrier cancels its tariff, the carrier should indicate on the title page or the first page of the
cancelled tariff the website address and the address of the public information site where the rates,
terms, and conditions can be found.
25. Carriers that have already cancelled their tariffs must be in full compliance with
section 42.10 of the Commission's rules within 30 days from the release of this order.
Likewise, carriers must be in full compliance with section 42.10 within 30 days of the release
date of this order, with respect to all new and revised contract service arrangements that have
become effective since May 1, 2000.
26. During the transition period, carriers cancelling their tariffs must post the rates, terms,
and conditions of the cancelled tariff on their website within 24 hours after the cancellation takes
effect. Both during and after the transition period, new or revised service offerings that are not
permitted to be offered under tariff must be posted on the Internet websites within 24 hours after
these offerings take effect. Public information sites must be updated within 5 days after a tariff
cancellation or new or revised service offering becomes effective.
27. The Commission's rules established in the Second Report and Order also require
nondominant IXCs to maintain price and service information regarding all of their detariffed
interstate, domestic, interexchange service offerings; and to retain the information for a period
of at least two years and six months after the carrier ceases to provide the service. Parties are
reminded that these requirements are subject to the Commission's enforcement policies.
1. Content of Public Information Disclosure
28. In the Second Report and Order, the Commission determined that the public
information locations should contain information on a carrier's current rates, terms, and
conditions for all of their interstate, domestic, interexchange services that is available to the
public in an easy to understand format, in a timely manner, and in at least one location during
regular business hours. In the Order on Reconsideration, the Commission eliminated the
public disclosure requirement, but later reestablished the requirement in the Second Order on
Reconsideration. The Commission did not prescribe specific content, or require that public
disclosure of this information be made in any particular format or at any particular location,
except that the information must be posted on the websites of those IXCs that currently maintain
them over the Internet.
29. The commenters disagree as to whether the Commission requires the public
disclosure of rates, terms and conditions for all services. WorldCom and SBC/SNET contend
that only the standard, mass market offerings must be disclosed publicly and on the carriers'
websites, and not individually negotiated contracts, while other parties argue that information
on all services must be publicly disclosed. We reiterate the requirement explicitly stated in the
Second Reconsideration Order that information on all services must be publicly disclosed,
including information on services offered through individually negotiated contracts.
30. Several parties also urge us to require carriers to include information that is "easy to
understand," and in sufficient detail to allow consumers to make informed choices. We
reemphasize that carriers should disclose enough information to allow consumers to make
comparisons among the various services offered by the carrier and the services offered by other
carriers. Carriers, however, are not required to include more information than is currently
included in their tariffs.
31. Although we decline to mandate a specific format to which carriers must adhere with
respect to publicly disclosed information, we nevertheless are cognizant of the need for carriers
to provide this information in a format which is "easy to understand" by consumers in the
business and especially the residential mass market. We recognize that this information is
critical in order to allow consumers to make comparisons among the various services offered by
the carrier and services offered by other carriers. We encourage carriers to work with the
Commission's Consumer Information Bureau to develop appropriate formats for the required
disclosures.
D. Carrier Certification
32. The Commission recognized in the Second Report and Order that carriers operating
in competitive markets would not necessarily maintain geographically averaged and integrated
rates for interstate, domestic, interexchange services, absent a legal requirement that they do so.
The Commission is committed to enforcing the rate averaging and rate integration requirements
of the 1996 Act, and has put carriers on notice that they may be subject to civil and criminal
penalties for violations of these requirements. Specifically, the Commission has directed the
IXCs to file annual certifications stating that they are in compliance with their statutory
geographic rate averaging and rate integration obligations. The certifications must be signed by
an officer of the company under oath attesting to the company's compliance with the statutory
geographic rate averaging and rate integration requirements of section 254(g) of the Act.
33. WorldCom requests that carriers be allowed to file their initial certifications at the end
of the transition period after all tariffs have been cancelled. We find that this is a reasonable
request that will reduce administrative burdens on affected carriers. We conclude, therefore, that
IXCs are required to file initial certifications by May 1, 2001. Subsequently, the annual
certifications should be filed on May 1 of each year.
E. Summary of Tariff Filing Requirements
34. Several parties have requested clarification of the carriers' tariff filing requirements
during the transition period. WorldCom requests clarification of the prohibition on filing
individually negotiated service arrangements and of the status of mass market service offerings
that contain term and volume commitments during the transition period. Several parties have
requested clarification of the carriers' obligations with respect to contract tariffs that include both
domestic and international services.
35. Pursuant to the Second Report and Order, carriers may file new tariffs and revisions
to existing tariffs for mass market, interstate, domestic, interexchange services during the
transition period, but must discontinue this practice at the end of the transition period. This
includes mass-market services that contain volume and term requirements, but excludes contract
tariffs such as AT&T's Tariff 12 options, MCI's special customer arrangements, and Sprint's
custom network service arrangements.
36. Carriers are required to file tariffs for international services, including those in mixed
service tariffs, during the transition period and until the Commission issues a final decision
regarding detariffing of international services. Carriers may file the domestic portion of mixed
service contract tariffs during the transition period and until a final decision regarding
international detariffing, as long as the tariff includes the disclaimer or banner described in
Section II. B.2 above. Carriers must have on file at the Commission an international tariff that
reflects the international portion of a mixed services contract. Finally, carriers may file tariffs for
dial-around 1+ services or "casual calling" services and for services provided to new customers
until a written contract is executed, but for no longer than 45 days. The casual calling services
that may continue to be tariffed are those services for which the customer and carrier do not have
an underlying contractual relationship because of the unique technological concerns with dial-
around services that are not conducive to the establishment of a written contract.
XXXVII. ORDERING CLAUSES
38. Accordingly, IT IS ORDERED that pursuant to the authority specifically delegated to
the Common Carrier Bureau in the Second Report and Order, and under Sections 0.91 and 0.291
of the Commission's rules, 47 C.F.R. 0.91 and 0.291, the deadline for detariffing mass-market
consumer services IS EXTENDED from January 31, 2001 to April 30, 2001.
39. IT IS FURTHER ORDERED that pursuant to the authority delegated under Sections
0.91 and 0.291 of the Commission's rules, 47 C.F.R. 0.91 and 0.291, Econobill Corporation's
Motion to Accept Late-Filed Pleading IS HEREBY GRANTED.
FEDERAL COMMUNICATIONS COMMISSION
Dorothy T. Attwood
Chief, Common Carrier Bureau
APPENDIX A
List of Parties
Comments
Ad Hoc Telecommunications Users Committee (Business Consumers)
Association of Communications Enterprises (ASCENT)
AT&T Corporation (AT&T)
Bell Atlantic Long Distance Companies (Bell Atlantic)
Competitive Telecommunications Association (Comptel)
Econobill Corporation (Econobill)
General Services Administration (GSA)
GTE Service Corporation (GTE)
National Telephone Cooperative Association (NTCA)
Sprint Communications Company, L.P. (Sprint)
Telecommunications Management Information Systems Coalition (TMIS Coalition)
WorldCom, Inc. (WorldCom)
Reply Comments
ASCENT
American Petroleum Institute (API)
AT&T
Bell Atlantic
Business Consumers
Cable & Wireless, Inc. (Cable & Wireless)
TMIS Coalition
Econobill
GSA
GTE
SNET America, Inc. and Southwestern Bell Telephone Company (SBC/SNET)
Sprint
WorldCom